The present invention relates to resolving discrepancies between recorded receipts and bank deposits in an accounting system for a business enterprise. In particular, the present invention relates to real time correction for such discrepancies in general ledger amounts, and to reconciliation of bank statements with such discrepancies. Generally, the person reconciling the bank statement is not the same person who created the bank deposits. The person doing the reconciliation may not understand any discrepancies between what the bank says was deposited and what an ERP system says was deposited.
As a retailer completes sales transactions and receives payments from customers, the sales amounts are typically recorded using cash registers or point-of-sale terminals. The payments received (receipts) accumulate in cash register tills (or cash safes) at the retailer's premises. The accumulated receipts are taken periodically to a bank and deposited in a bank deposit account. There is generally also a small, relatively constant, amount of cash that is retained at the retailer's premises for making change for customers, and that is never deposited.
The cash registers compute the total sales amounts as well as any payments received. These are entered into an accounting system and increase general ledger balances. The general ledger balances, in turn, are relied on as representative of an amount of “cash on hand” in the bank deposit account. Decisions, such as a decision to transfer funds out of the bank deposit account, are made in real time based on the information in the general ledger account.
It sometimes happens that the actual amount of deposit to the bank has a significant variation from the total receipts computed by the cash registers. Variations can be due to theft, mysterious disappearance, errors in making change, cash taken out of a till to pay for deliveries at the retailer's premises, expenses for emergency repairs, or the cost of entertaining customers or others. Funds which are misplaced on one day may be found on a subsequent day, resulting in a variation in deposits for both days. At the end of the day, the bank deposit will sometimes be different than the computed total receipts.
Errors in the general ledger due to these discrepancies can persist for a month or more and may only be corrected when a monthly bank statement is received and reconciled with the general ledger. In the meantime, variations can accumulate to large amounts, leading to real time errors in decisions to transfer funds out of the deposit account or decisions to report income for the enterprise. The problem is compounded in large enterprises where there are multiple cash registers in each retail location, multiple retail locations, and multiple banks where deposits are made.
In the prior art, such general ledger errors have been dealt with inadequately by leaving larger balances than needed in deposit accounts, manually calculating estimated adjustments from the general ledger amounts and telephone calls between an accounting department and a retailer's premises or the bank to attempt to estimate or correct for general ledger errors.
A method and apparatus are needed to automatically reduce real time errors in general ledger accounts due to discrepancies in amounts deposited in bank accounts relative to recorded receipts.